user
Trading stocks has become increasingly popular with more people investing. Explain the risks involved with trading stocks.


assistant
Trading stocks carries with it many risks. The most obvious risk is that of financial loss due to a decrease in the value of a stock. This risk is magnified by leverage where traders borrow funds to increase their position size. Trading stocks also carries a risk of psychological stress, especially when trades result in financial losses. Additionally, the stock market is highly volatile and subject to wide price swings, meaning that any investment carries the risk of substantial losses. Finally, there is the risk of investing in stocks that are poorly researched, or investing in companies with poor fundamentals that could lead to a loss of capital.